DAILY NEWS Feb 6, 2013 2:21 PM - 1 comment

Munich Re posts $4.3 billion profit for 2012, satisfied with renewals

TEXT SIZE bigger text smaller text

Global reinsurance giant Munich Re has posted a profit of €3.2 billion ($4.3 billion) for 2012, up from €0.71 billion in 2011, saying it is satisfied with its renewals going into this year.

FinancialFor 2012, the company posted an operating result of €5.4bn. At press time, 1 euro was equal to $1.35.

“This very pleasing profit is founded on our rigorous risk management, disciplined underwriting policy and the realisation of profitable business opportunities,” Munich Re CFO Jörg Schneider said in a statement on the preliminary figures.

“Our core business in insurance and reinsurance is healthy, while the claims burden from major losses was slightly below average. We also achieved a good investment result. 2012 thus brought good progress, allowing us to further strengthen our capital resources.”

In its primary insurance business, Munich Re showed a profit of €0.25 billion, up from  €0.16 billion in 2011.

Gross premiums written in the financial year 2012 fell by 2.1% to €17.1 billion (17.4 billion in 2011). The combined ratio in property and casualty insurance was 98.7% for 2012 as a whole, compared with 99.1% the year before.

The reinsurance segment contributed €3.1 billion to the consolidated result, with the operating result up by €3.9 billion to €4.3 billion, the company said. Compared with the previous year, premium income grew by over 8% to €28.2 billion. The combined ratio in property and casualty reinsurance was 91.0% of net earned premiums for the year as a whole and 83.2% for the fourth quarter.

The company’s natural catastrophe losses amounted to around €1.3 billion for the entire year, and man-made losses to €0.5 billion. The year’s biggest loss event was Hurricane Sandy, causing insured losses in the range of $25 billion (not taking national flood insurance into consideration) and costing Munich Re around €800 million net before tax, it noted.

The company also said it was satisfied with the results from its Jan. 1 renewals. At that time, more than half of its non-life business was up for renewal, with only 10% not renewed. New business with a volume of approximately €880 million was also acquired at that time.

“Demand for reinsurance cover remains relatively constant, and sufficient capacity is available,” Torsten Jeworrek, Munich Re’s Reinsurance CEO commented in a statement. “In a still-challenging economic environment, a consistent underwriting policy and active cycle and portfolio management are vital for the profitability of our portfolio.”

Monitor These Topics

Horizontal ruler

Note: By submitting your comments you acknowledge that Canadian Underwriter has the right to reproduce, broadcast and publicize those comments or any part thereof in any manner whatsoever. Please note that due to the volume of e-mails we receive, not all comments will be published and those that are published will not be edited. However, all will be carefully read, considered and appreciated.

comments powered by Disqus